Page 93 - Marketing Management
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70     PART 2    CAPTURING MARKETING INSIGHTS



                                      Internal Records

                                      To spot important opportunities and potential problems, marketing managers rely on internal
                                      reports of orders, sales, prices, costs, inventory levels, receivables, and payables.


                                      The Order-to-Payment Cycle
                                      The heart of the internal records system is the order-to-payment cycle. Sales representatives, dealers,
                                      and customers send orders to the firm. The sales department prepares invoices, transmits copies to
                                      various departments, and back-orders out-of-stock items. Shipped items generate shipping and
                                      billing documents that go to various departments. Because customers favor firms that can promise
                                      timely delivery, companies need to perform these steps quickly and accurately. Many use the Internet
                                      and extranets to improve the speed, accuracy, and efficiency of the order-to-payment cycle.



                                         Fossil Group  Fossil Group  Fossil Group Australia designs and distributes accessories
                                              and apparel globally. Its account executives lacked the latest information about pricing and
                                              inventory while taking wholesale orders. High demand items were often out of stock, cre-
                                              ating problem for retailers. After the firm deployed a mobile sales solution that connected
                                              account executives with current inventory data, the number of sales tied up in back orders
                                      fell 80 percent. The company can now provide retailers with actual inventory levels and ship orders in
                                      hours instead of days. 4


                                      Sales Information Systems
                                      Marketing managers need timely and accurate reports on current sales. Walmart operates a sales
                                      and inventory data warehouse that captures data on every item for every customer, every store,
                                      every day and refreshes it every hour. Consider the experience of Panasonic.


                                              Panasonic        Panasonic makes digital cameras, plasma televisions, and other
                                              consumer electronics. After missing revenue goals, the company decided to adopt a
                                              vendor-managed inventory solution. Inventory distribution then came in line with consump-
                                              tion, and availability of products to customers jumped from 70 percent to 95 percent. The
                                              average weeks that product supply sat in Panasonic’s channels went from 25 weeks to just
                                                            5 weeks within a year, and unit sales of the targeted plasma television
                                                            rose from 20,000 to approximately 100,000. Best Buy, the initial
                                                            retailer covered by the vendor-managed inventory model, has since
                                                            elevated Panasonic from a Tier 3 Supplier to a Tier 1 “Go-To” Brand for
                                                            plasma televisions. 5



                                                               Companies that make good use of “cookies,” records of Web site
                                                            usage stored on personal browsers, are smart users of targeted
                                                            marketing. Many consumers are happy to cooperate: A recent survey
                                                            showed that 49 percent of individuals agreed cookies are important
                                                            to them when using the Internet. Not only do they not delete cook-
                                                            ies, but they also expect customized marketing appeals and deals
                                                            once they accept them.
                                                               Companies must carefully interpret the sales data, however,
                                                            so as not to draw the wrong conclusions. Michael Dell gave this
        Panasonic’s new vendor-managed  illustration: “If you have three yellow Mustangs sitting on a dealer’s lot and a customer wants
        inventory system met with     a red one, the salesman may be really good at figuring out how to sell the yellow Mustang. So
        marketplace success, including  the yellow Mustang gets sold, and a signal gets sent back to the factory that, hey, people want
        from retailers.               yellow Mustangs.” 6
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